AirMedia Group Takes New Steps in Strategic Transformation
The provider of airport advertising will focus on developing WiFi and other communication services as well as use blockchain for airline points.
AirMedia Group Group Inc. (Nasdaq: AMCN) is taking off in a new direction.
The 11-year-old airport advertising company, with headquarters in Beijing, announced this week that it plans to focus on providing in-flight WiFi and other communication services for passengers in the aviation, rail, and long-haul bus industries.
It has also agreed to partner with a blockchain technology company, Beijing Lords Technology Ltd., to use blockchain technology in the development of new products and improve services.
"Looking forward, we believe the strategic transformation will position AirMedia well for sustainable growth for the years to come as an industry pioneer," said AirMedia Chairman and CEO Herman Man Duo in a statement.
In the past, AirMedia has concentrated on selling ads on a number of air routes operated by Chinese carriers and at Sinopec service stations. It also has concession rights for WiFi services on several train and long-haul bus lines.
AirMedia's self-described "strategic transformation" comes amid a nationwide push to improve infrastructure and services at airports and other travel hubs. Because of its expanding middle class and more open business environment, China has seen travel soar in recent years. More than 540 million travelers took flights last year, a 40-percent increase from four years ago. Aviation observers expect continued positive trends, though they've expressed concerns that an inability to address travelers' needs for convenience and comfort could hinder the pace of expansion.
A $13-billion airport in the Beijing suburb of Daxing is set to open later this year, more than doubling capacity in China's third-largest city, and other airports are undergoing improvement projects.
Passenger volume on the country's rail system has, meanwhile, also skyrocketed, largely driven by swift advances in fast rail service. In 2016, almost 1.5 billion passengers traveled on China high-speed trains that can hit in excess of 180 mph.
Transition Started Last Year
AirMedia kickstarted its strategic transformation last April when its subsidiary AirMedia Online Group created a joint venture, Unicom AirMedia Network Co. Ltd., with China Unicorn and another investor to build a global communication network and in-flight internet. China Unicorn is heavily involved in initiatives to improve global satellite and mobile technology.
AirMedia said that the partnership with China Unicorn would "improve the marketization" of China's aviation mobile internet.
Adding Blockchain Into the Mix
In terms of its blockchain expansion, AirMedia said the development was intended "to realize this transformation, create new industrial chains and upgrade businesses." The company plans to work through its subsidiary, Wangfan Tianxia Network Technology Co., Ltd., in partnership with Beijing Lords, to use blockchain technology for the development of travel-related communication products and services. They will include using blockchain for airline points programs and the safeguarding of aviation media content.
Man Duo hailed the agreement as "a significant milestone."
"The combination of Beijing Lord's blockchain technology with our impressive customer base gives us the credibility and scale to create a series of disruptive products based on the blockchain technology and stand apart from the competition," he said.
AirMedia stock, which has struggled over the past several months, ended the week at $1.33 per share.